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Sri Lanka repays Citibank, ICIC loans

Dec 31, 2008 (LBO) - Sri Lanka has repaid 175 million US dollars in commercial loans, involving Citibank and India's ICICI Bank, and raised only 150 million dollars in new loans, in 2008, the government's debt office said.
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A 100 million US dollar syndicated loan arranged by Citibank in 2005, a balance 25 million US dollar Citibank loan arranged with the help of NEXI of Japan and a 50 million dollar loan from ICICI Bank arranged via state-run NSB has been paid back.

The debt office, which is a department of the central bank, said new foreign currency commercial borrowings in 2008 were only 150 million US dollars and external commercial debt has fallen to 460 million US dollars at end-2008 from 460 million US dollars in end-2007.

Foreign purchase of government rupee securities which was 443 million US dollars (50 billion US dollars) at end-2007 and had increased to 620 million US dollars (70 billion rupees), had also fallen.

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From mid-September 407 million US dollars (46 billion rupees) of such borrowings had left the country, the debt office said.

Outstanding Treasury Bonds and Treasury bills held by foreign parties were valued 213 million US dollars or 24 billion rupees.

The central bank said it had met the outflows with reserves built-up earlier in the year.

Commercial borrowings from international capital markets can be fickle and borrowers have difficulty in rolling over debt in times of instability.

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